In India, each metric tonne of stainless steel scrap reportedly costs $100 more than in European markets. India buys the largest amount of scrap of any steel producing region in Asia, although its purchasing habits are driven by short-term production requirements and are therefore relatively spot-driven, with Indian steel mills tending not to keep large stocks of scrap.
By contrast, and despite its large output of stainless steel, China’s stainless steel scrap use ratio is only 30%, 20% below the world average, preferring instead to use nickel pig iron as a raw material. At least one analyst believes that, rather than being an importer of steel scrap, China has the potential to be a net exporter of steel scrap to Europe, but that the 40% export tax is currently serving as a disincentive.
The price of nickel pig iron that China relies on has spiked in response to the Indonesian ban on ore exports, and analysts suggest that scrap will become more important to China if the ban persists and global stock levels continue depleting.
In the US, increased production capacity has led to increased imports of scrap – increasing 200% in the first quarter of 2014.
The price for several grades of stainless steel scrap dropped in November 2014, with some industry players like Novelis ramping up recycling projects to reduce their reliance on scrap. Recent figures from Recycling International indicate that the price of grade 304 and 316 have dropped further, to a range of $1250-$1300 and $1750-$1800 per tonne respectively, while 409 and 430 chrome scrap has dropped to a range of $320-$360 and $410-$450 per tonne, respectively.